After raising $282 million from an initial public offering, Round Hill Music has successfully received another $291 million in equity commitments from the private placement market, bringing total fundraising this month to $573 million.
The $291 million will be used by the company’s Music Royalty Fund III to invest in royalty-producing intellectual property related to blue chip music assets containing classic songs. In fact, the company had already been deploying the funding commitments before closing off the fund from further investors, spending some $200 million in deals that involved music by the Goo Goo Dolls, Matchbox Twenty and Rob Thomas, Black Sabbath, the Dropkick Murphys, Kiss, Limp Bizkit, Blues Travelers, Bruno Mars, Skid Row and Bachman Turner Overdrive.
In an announcement, Round Hill said the funding comes from its existing investor base of endowments, foundations and pension funds, while also adding select institutional investors.
“We are grateful for the continued confidence and strong support we received for Fund III from a diverse group of new and existing high caliber investors,” Round Hill Music CEO Josh Gruss said in a statement. “Round Hill Music has continued to distinguish itself as a leader in the music royalty space by acquiring blue chip songs with enduring long-term popularity. We are pleased to serve as the partner of choice for songwriters and other third parties, attracting a talented team with a deep knowledge of the investment and music industries. Noting that music royalty assets show resilience in difficult economic environments, he added, “our objective continues to be to provide investors with regular and growing income and capital returns from investment primarily in high quality, music intellectual property.”
Earlier this month, Round Hill raised $282 million through the IPO for its Music Royalty Fund Ltd. The company plans to use that funding to buy the music assets acquired by the Round Hill Music Royalty Fund I, which closed commitments in 2014. That fund had raised $202 million. In 2017, the company closed its Music Royalty Fund II, which raised $260 million for acquisitions.
Focus Point served as the exclusive placement agent for North America for Round Hill’s Music Royalty Fund III, after also fulfilling that role for the two earlier Round Hill Music Royalty funds. So far, the company says it has acquired over 80 music catalogues, with a portfolio of songs recorded by the likes of James Brown, Louis Armstrong, The Offspring, Carrie Underwood, The Beatles and Backstreet Boys, among others. The company says it has generated over $175 million in royalty income since its inception.
“We were able to raise our largest fund to date amid the COVID-19 pandemic due to continuing favorable market conditions, including improved copyright law, a surge in streaming subscription services, and increased synchronization opportunities,” Round Hill Music president Neil Gillis said in a statement. “For more than decade, Round Hill Music has generated strong risk-adjusted returns for our investors and we look forward to continued innovation as we seek to capitalize on great tailwinds for our business.”